Auth0, a platform for modern identity authentication, recently announced its Series A funding to help augment the firm’s current team of approximately 50 people who support its growing subscriber base. The company has seen revenue growth of 20-30% month-over-month for the past year.
The company strives to make it easy for developers to implement even the most complex authentication and authorization solutions for its web, mobile and internal applications, APIs, and IoT devices.
Among Auth0’s clients are JetPrivilege, HarperCollins Publishing, Schneider Electric, Berkshire Hathaway Travel Protection and Time Warner’s TMZ. For Auth0 CEO Jon Gelsey, identity is the new firewall.
“In a world where virtually every device and application either already does or aspires to connect to the Internet and to other devices and applications, the old paradigm of a firewall providing data protection at the perimeter no longer works,” Gelsey told Hacked.
“There is no perimeter because devices are connected everywhere. Instead, the best practice today is for every application, API and IoT device to assume it’s in a hostile environment and to handle its own security.” For Auth0, security starts with strong identity.
“If you are absolutely certain of the identity of a person or machine accessing your data or imputing commands, such as ‘turn the AC on in the house at 4pm’ or ‘show me my infant’s sleeping patterns’, by definition you’ve stopped hackers,” Gelsey said.
“‘Absolute certainty’ is a difficult bar to reach, though, so the goal is to be as certain as possible regarding identity,” he added.
To achieve this, one must always employ the best practices for authenticating and authorizing users with multiple factors of authentication, as well as being up to date on the latest vulnerabilities.
“That means employing best practices for authenticating and authorizing users, using multiple factors of authentication, and being always up to date on the latest vulnerabilities,” he added.
With Auth0, developers don’t need deep vertical experience across authorization, authentication, identity management and security applications. They can quickly secure applications and APIs by adding just a few lines of code, provided by Auth0, regardless of the complexity of the identity environment.
“We make it easy for developers building IoT connected applications to implement strong identity security as an important first step to ensuring user protection and ultimately a great user experience for their product,” Gelsey said. Coverage of the Internet of Things often highlights the negative possibilities for the technology. Gelsey is excited about the positives.
“The coolest part of IoT is that I can virtualize expensive smarts – say, the CPU capacity to run sophisticated machine learning code on a multi-petabyte database – from the IoT device into the cloud, where it can be a shared resource and hence much cheaper,” Gelsey told Hacked. “While an unconnected device – say a thermostat – is fairly dumb when unconnected, it can be very smart when connected and without the cost going up materially.” This means we can all have very smart devices that make our lives easier.
Also read: Risky Business: the Internet of Things (IoT)
“Because the IoT devices can communicate, they can figure out more about their environment and do smarter and more convenient things because they have better data – data that would have been too expensive to collect before,” Gelsey reasoned. “For example, my car can automatically brake because it is told by a car ten cars ahead of me that it had to brake. This saves me from slamming on the brakes at the last second, therefore making driving safer.” Gelsey sees the IoT everywhere he looks, including in entertainment new and old.
“The concept of devices and apps connecting with one another is certainly not new – the Jetsons are maybe an obvious, earlier example of this,” Gelsey recalls. “More recently we can see instances in almost every TV show and movie that’s made today. Fox’s Fringe showcased an alternate universe with technology slightly more advanced than our own, and crime shows like CBS’s CSI regularly feature technology that isn’t yet available to most real law enforcement agencies.” Tiny voice and touch-activated wearable smartphones and helicopters that run solely on autopilot are not where IoT ends for Gelsey.
“I like the various bots in Neal Stephenson’s Seveneves – each one fairly stupid on its own, but when all work together they become enormously valuable contributors to saving the human race,” he told Hacked. Gelsey believes that IoT will particularly change the lives of developers.
“The biggest change will be thinking about how to take advantage of all this really cool, really cheap sensor data and how humans can interact with devices without traditional UX’s like keyboards, screens, and so on,” he predicted. “As well as, of course, spurring new product and service ideas that billion-dollar new companies will be built upon.” In Gelsey’s opinion, developers will have to be careful when navigating new frontiers.
“To borrow words from the recent movie, Jurassic World, ‘The park needs a new attraction every few years to reinvigorate the public’s interest, kind of like the space program. Corporate felt genetic modification would up the ‘wow’ factor,’” Gelsey paraphrased.
“If you’re not familiar with the premise of the movie, they’re talking about having ‘built’ a genetically modified dinosaur – one who was bigger, scarier and more dangerous than any dinosaur that ever existed in nature – in order to satisfy the ever-growing demands of the park audience. The concept – not as extreme, of course – can be applied to the demand for IoT connectivity today.” That developers are under pressure to build new and exciting things and get them to market quickly leads many to cut corners on security.
“With the prevalence of recent high-profile hacks, and the even more recent Jeep hacking experiment, it’s clear that developers are sometimes taking shortcuts in security to ship faster,” Gelsey observed. “The challenge here will be to ship fast without sacrificing security.” And that’s where Auth0 comes in
“By simplifying identity within an enterprise – something Auth0 can help developers do in days or weeks instead of months – developers can more easily identify and secure those areas that would have been most vulnerable,” he said. For Gelsey, it’s like Adam Smith’s “comparative advantage” in Wealth of Nations.
“Why try to grow wine grapes in Ecuador when you can grow pineapples more easily, and then trade those pineapples?” he said. “You get paid more for your core competencies, so why spend time and lose money doing something that’s not a core competency?” Auth0 strives to keep clients out of the authentication business, so their clients can focus on their business’ true value.
“Authentication is complex and, if done incorrectly, has big security costs, so unless your business is to be an authentication and authorization provider, why would it ever be worth your time to do it yourself?” Authentication has changed in the past ten years.
“Authentication has grown much more complex because there are many more sources of identity now than there were ten years ago,” Gelsey told Hacked. “And the hacking community has become much more sophisticated, especially with the advent of state-sponsored cyberattacks.” There are many advantages for nation-states to enter the hacking game.
“Many countries have recognized that cyber warfare is a less expensive and less risky way to accomplish national aims that previously were only achievable through military force,” Gelsey said.
“And, of course, criminal hacking gangs have seen what nation-states can accomplish and are actively working to emulate them. Strong identity security is the first step in defending against sophisticated attacks.” Auth0 recently launched Auth0 Europe. The company chose this direction for a simple reason: to meet demand.
“The EU has different privacy and data protection regulations than the US, and countries like Germany have further augmented EU rules,” Gelsey told Hacked. “While we have always been fully compliant with the regulations of every country we do business in, it provided additional peace-of-mind for European customers to know their version of Auth0 was inside EU and even German borders.” For the modern entrepreneur, Gelsey stressed, authentication is critical.
“If people can’t login to your web or mobile app, API or IoT device, they can’t do anything else,” he said. “And on the enterprise side, if employees can’t access the systems and data they need to do their jobs, you don’t have a business.” For Gelsey, authentication and authorization are the very first building blocks you need to start a business.
“Aside from the basic ability to login, you’ll also want to know who’s accessing your product or stored data,” the CEO said. “Without being able to measure and understand customer behavior you can’t hope to build and maintain a product that will survive to meet customer demands.”
Once a business implements authentication, the work is just beginning. That company will need to maintain proper authentication and authorization amid ever-changing technology and security protocols, a challenging and time consuming, endeavor. Amid the change, What trends should developers keep their eyes on?
“The megatrend, of course, is that apps and APIs are assembled, not written,” Gelsey said. “That’s a bit of hyperbole because there is a lot of skilled software engineering being done every day, but the advent of cloud infrastructure services means those developers can ‘stand on the shoulders of giants’ and build more amazing things incredibly quickly.” Gelsey believes in the future strong identity security becomes simpler.
“In the same way that no one today thinks about networking for their app – because it’s a given that an IP connection is ‘just there’ – we see a not-so-distant future where authentication is ‘just there.’ Developers will no longer have to worry about identity and security for their applications, API’s, and IoT devices.”
Images from Shutterstock and author.
iComply ICO Adds Blockchain Thought Leader “ThePiachu” to Its Management Team
iComply Investor Services Inc. made a big move this month by landing the services of Piotr Piasecki, known by many in the blockchain community as “ThePiachu”. Piasecki will serve in the leadership capacity of decentralization manager for the iComply platform ahead of its beta launch in the new year.
Piasecki’s Track Record
Active on the blockchain scene since 2011, Piotr Piasecki is one of bitcoin’s earliest backers. In 2012, he delivered his Master’s thesis on bitcoin security to the Technical University of Lodz in Poland. Just one year later, he received the first Bitcoin Foundation grant. That same year, he published a paper on smart contracts in Ledger, the first academic journal dedicated to blockchain.
In joining iComply, Piasecki will leave his previous role at Factom, a blockchain services company based in Austin, Texas.
iComply: Right Place at the Right Time
iComply ICO is a platform for token compliance that helps investors and startups navigate the legal and regulatory maze of the ICO market. Investment in ICOs reached $2.3 billion in the first nine months of 2017, surpassing early-stage venture capital. However, the outlook on ICOs has grown murky since the Securities and Exchange Commission (SEC) ruled that token sales can be classified as securities and therefore subject to federal regulation.
The SEC made a landmark ruling in July that tokens offered by The DAO venture capital fund were securities and therefore subject to federal laws. ICO issuers and investors have been scrambling ever since.
Against this backdrop, iComply seeks to bring more regulatory clarity to the ICO market. It has already engaged with international governments, regulatory bodies and financial institutions in pursuit of a common framework around ICO regulation. Matthew Unger, the company’s CEO, was recently invited to attend the annual meetings of the International Monetary Fund (IMF) and World Bank in Washington.
The timing of iComply’s ramp-up is what attracted “ThePiachu” to the company in the first place.
“After the the recent SEC ruling on ICOs and securities, a new market opportunity arose to help these various companies adhere to compliance guidelines,” Piasecki tells Hacked.com. “And as they say – in a gold rush, sell shovels.”
He adds: ““I believe the ICO landscape will see a new wave of ICO-securities, bringing both renewed interest and a chance for new types of products that we haven’t seen yet in this space to emerge.”
Piasecki believes that the growth and widespread adoption of cryptocurrency will lead to more efficient payment methods put in place. This means having the ability to transact between several currencies without the friction we currently experience. When this happens, the currency you are transacting won’t matter as much as the value it represents.
The shifting regulatory landscape will challenge this paradigm from emerging, as evidenced by the recent crackdowns in China and South Korea. However, markets like Japan are embracing digital payments, with regulators there seeking to streamline and regulate the cryptocurrency system. Russia is taking an entirely different approach by centralizing blockchain mining and allowing digital currency holders to exchange their assets for fiat money.
Featured image courtesy of Shutterstock.
Bitcoin Giant Bitmain Enters the High Stakes AI Race
The Sophon, named for a fictional proton-sized supercomputer, could be the tool to train neural networks in data centers worldwide. It is the latest project being developed by Bitmain Technologies Ltd., the bitcoin mining giant that has carved out a dominant position in bitcoin mining.
Such chips, called application-specific integrated circuits (ASICs), could unleash a new wave of distributed computing, according to Michael Bedford Taylor, a University of Washington professor who studies bitcoin mining and chips.
Sophon is due to debut before the end of the year.
Bitmain Has The Know-How
Bitmain has the background to play a role in the expanding artificial intelligence industry. The company designs the silicon that goes in bitcoin mining equipment, assembles the machines and sells them worldwide, in addition to its own bitcoin mining operation and the ones that it manages for other mining pools.
Bitmain’s founders are not averse to playing a spoiler role.
Jihan Wu, the co-founder of Bitmain, supports the New York Agreement that seeks to double the bitcoin block size under the SegWit2X proposal, a move that some in the bitcoin community view as an attempt to give the miners control over bitcoin.
Some also believe Wu was behind the recent bitcoin split known as bitcoin cash, which at least one of Bitmain’s miners supported, a contention that Wu has denied. Wu points out that he was among the supporters of Bitcoin Unlimited, an earlier bitcoin scaling proposal that did not get activated.
Why Wu Supports Forks
Wu nonetheless said splits should be allowed. He said a fork is inevitable since people in the bitcoin community do not agree on how to best scale bitcoin.
Wu met Micree Zhan, Bitcoin’s co-founder, when Zhan was running DivaIP in 2010, a company that made a device that allowed a user to stream a TV show on a computer screen.
In 2011, Wu needed a chip designer to build a mining operation and approached Zhan. Zhan first designed an ASIC to run SHA-256, the cryptographic calculation used in bitcoin, at maximum efficiency. It took him six months to finish the job. His first rig, Antminer S1, was ready in November 2013.
Bitmain felt the sting of the 2014 Mt. Gox meltdown. But by 2015, bitcoin’s price bottomed out and later recovered. In the meantime, Bitmain introduced its Antminer S5.
Bitmain now employs 600 people in Beijing.
Ready To Take On Google
Bitmain has since developed a deep learning chip with improved efficiency. Users will be able to build their own models on the ASICs, enabling neural networks to deliver results at a faster pace. Google’s DeepMind unit used this technique to train its AlphaGo artificial intelligence.
Bitmain plans to sell the chips to any company looking to train its own neural nets, including firms like Alibaba, Tencent and Baidu. Bitmain could build its own data centers with thousands of deep learning rigs, renting out the computation power to clients the way it does with bitcoin mines.
Professor Taylor said companies like Bitmain that have excelled in bitcoin mining could take on the Googles and Nvidias since they have developed the skills to survive in an ultra-competitive and highly commoditized industry, and have the system level design expertise and the ability to reduce data center costs.
Biotech And Industrial Metals Top Penny Stocks To Watch For August
Leading market benchmarks hit new highs in July, generating interest in small-cap stocks and low-priced securities for August, according to the Investopedia penny stocks to watch for August.
Suffering sectors like industrial metals and brick-and-mortar retailers also perked up, driving swing traders and bottom feeders into the market. Such developments bode well for penny stocks in the near-term, even though traders have to recognize higher than average risk.
Biotech stocks performed well during the month as major sector funds broke out of basing patterns set in 2015. The strength of biotechs signals the start of secular uptrends that should support rallies at all capitalization levels in the next few months.
Four of this month’s stocks return from the previous two months while the balance are newcomers.
1. ImmunoGen Inc. (IMGN)
ImmunoGen, Inc. has grown by more than 70% since it joined the penny stock watch list in June, raising odds for double digit growth.
Immunogen, a provider of antibody-drug conjugates for the treatment of cancer, leads the top penny stocks for the second straight month after joining the list in June as the number four top stock to watch.
The stock posted a 12-year high at $20.25 in 2013 and sold off to $5.34 in December 2014. A recovery in 2015 stalled less than a point below the prior peak, creating a decline that continued into an 18-year low at $1.51 in November 2016.
The stock reached a 14-month high above $8.00 in early July. A mid-month pullback dropped the stock into intermediate support at the 50-day EMA, creating a healthy bounce that could now test the prior high, pushing into double digits.
ImmunoGen creates targeted cancer therapeutics. The company’s candidate, mirvetuximab soravtansine, is in a Phase 3 trial for an ovarian cancer, and is in Phase 1b/2 testing in combination regimens for an earlier-stage disease.
The technology is used in Roche’s Kadcyla, in three other clinical-stage ImmunoGen product candidates, and in programs in development by Amgen, Bayer, Biotest, CytomX, Lilly, Novartis, Sanofi and Takeda.
2. RADA Electronic Industries, Ltd. (RADA)
RADA Electronic Industries, Ltd. (RADA), a defense electronics system of advanced electronic systems for airborne and land applications, rose from number 7 in July’s top penny stocks to watch to number two in August.
The stock fell into a multi-decade decline after it joined Nasdaq in the 1990s. It ground out a series of lower highs and lows through January 2016’s all-time 54-cent low. The stock spent 16 months moving sideways in a narrow basing pattern before turning higher in May 2017 and rallying back to 2016 resistance at $1.78. The bullish activity completed a cup and handle breakout pattern that could point to a fast rally into the August 2015 gap between $3.70 and $2.50.
The stock continues to gain strength, targeting the August 2015 gap at $4.24
Revenues totaled $4.7 million in the 2017 first quarter, up 91% compared to revenues of $2.5 million in the first quarter of 2016.
Gross profit totaled $1.7 million in the first 2017 quarter of 2017, a gross margin of 35.7%, compared to gross profit of $6,000 (gross margin of 0.2%) in the 2016 first quarter.
Operating income was $0.4 million in the first 2017 quarter compared to an operating loss of $1 million in the 2016 first quarter.
Net income attributable to RADA’s shareholders in the 2017 first quarter was $0.4 million, $0.02 per share, versus a net loss of $1.8 million, or $0.23 per share, in the 2016 first quarter.
3. 22nd Century Group, Inc. (XXII)
22nd Century Group, Inc., a plant biotechnology company that is a provider of tobacco harm reduction and development of proprietary hemp/cannabis strains, rose from the number five spot in July’s top penny stocks to watch to number three in August.
The stock broke out above multi-year resistance near $1.50 in 2013, rallying to a record high a few months later at $6.36. It then began a persistent decline through August 2015 before finding support at 56 cents, followed by a bounce to $1.75.
The stock traded within those boundaries for 22-months, bouncing at support three times and reversing at resistance in equal measure. The price returned to that level a fourth time, improving odds for a breakout that could double the price in the year’s second half.
The stock found support near 70 cents in the second half of the year, testing that level three times ahead of a March 2017 uptick that has now reached ranged resistance. A breakout over $2 should draw strong buying interest favoring a high percentage rally back to its 3-year high.
The stock joined the Russell Microcap Index two months ago, when FTSE Russell reconstituted its U.S. and global equity indexes.
Membership in the Russell Microcap Index signifies automatic inclusion in the value style indexes. FTSE Russell determines membership for its Russell indexes primarily by objective, market-capitalization rankings and style attributes.
22nd Century Group focuses on genetic engineering and plant breeding that allows the increase or decrease of nicotine levels in tobacco plants and cannabinoids levels in cannabis plants. Its primary goal for tobacco is to lessen the harm caused by smoking. The primary goal for cannabis is to develop proprietary hemp/cannabis strains for new medicines and agricultural crops.
4. Ballard Power Systems, Inc. (BLDP)
Ballard Power Systems, Inc. (BLDP), a provider of clean energy products that reduce customer costs and risks, and helps customers solve challenges in their fuel cell programs, rose from the number 10 spot in the July penny stocks to watch to the number four spot in August.
The stock reached an all-time high at $144.95 in 2000 before falling for more than 12 years, reaching an all-time low at 56 cents. A 2013 uptrend continued through 2014, reaching an 8-year high at $8.38, followed by a correction that returned to 2015 resistance at $3.10.
The recovery wave reached new resistance in April 2017, generating a 3-month symmetrical triangle pattern that could yield an uptrend into the prior high.
Total revenue was $22.7 million in the last quarter, an increase of 39% from growth in both power products and technology solutions.
Gross margin was 42% in the quarter, an improvement of 22 points due to a shift in product mix toward higher margin technology solutions and a heavy duty motive for the China market, including the establishment of a production line in Yunfu, China for the manufacture and assembly of FCvelocity-9SSL fuel cell stacks.
Cash operating costs were $10 million in the quarter, a 6% increase due to higher research and product development expenditures as well as a stronger Canadian dollar relative to the U.S. dollar, since a significant amount of cost is denominated in Canadian dollars.
Low-priced biotech stocks have risen following a long slumber, with steady buying interest likely to continue. This group should offer a variety of profitable penny stock plays during the quiet summer trading season, while low-priced stocks in other sectors move into narrow trading ranges.
5. Trilogy Metals, Inc. (TMQ)
Trilogy Metals Inc., which engages in the development and exploration of mineral properties, joins the top penny stocks to watch list this month at number 5. The Vancouver, Canada-based company went public on the U.S. exchanges in April 2012 at $3.20, beginning an immediate downtrend to an all-time low at 15 cents in January 2016. A recovery wave mounted the 200-day EMA at 60 cents that stalled three months later, yielding a narrow basing pattern into a July 2017 recovery that has reached a 2-year high at $1.22.
A pullback to new support in the 80- to 85-cent price range should mark a low-risk buying opportunity, as the upside that could reach $2.
Trilogy Metals Inc. reported a strong working capital position of $20.1 million in the second quarter, with cash on hand of $14.5 million.
For the three months ending May 31, 2017, the company reported a net loss of $2.4 million compared to a net loss of $1.6 million for the corresponding period in 2016. This variance was primarily due to the size of the field programs at the Upper Kobuk Mineral Projects in 2017 as well as the timing of the program.
An increase of $840,000 of mineral property expenses occurred during the three months ended May 31, 2017 compared to the three months ended May 31, 2016. In 2017, the field program at Arctic and Bornite began with drilling by early June compared to 2016 where the field program kicked off in early July. This earlier start resulted in an increased mineral property expense during the second quarter of 2017. Additionally, an increased level of ongoing technical studies was occurring during the three months ended May 31, 2017 compared to the corresponding period in 2016.
The company announced a financial partnership with South32 Limited for an option to form a 50/50 joint venture for a minimum investment of $150 million. South32 is required to fund a minimum of $10 million per year for up to three years to keep the option in good standing. The first $10 million has been advanced to the company and will be spent on a 12,000-meter exploration drill program at the Bornite deposit, which is already underway.
6. Antares Pharma, Inc. (ATRS)
Antares Pharma, Inc., which focuses on self-administered parenteral pharmaceutical products, caught fire after suffering an all-time low at 29 cents in January 2009, then delivering a strong uptrend continuing into the July 2012 all-time high at $5.58. The stock then fell in multiple selling waves that ended at a 6-year low in March 2016.
The subsequent recovery has now completed a round trip into the April 2015 high, retracing half of the multi-year decline. The price has consolidated above $3 for the past three months, establishing the final stage of a 2-year cup and handle pattern targeting the multi-year high.
The company recently reported operating and financial results for the second quarter ended June 30, 2017. The company reported revenue of $13.4 million and a net loss per share of $0.02 for the three months ended June 30, 2017.
Revenue for the three months ending June 30, 2017 was $13.4 million, compared to $12.2 million for the comparable period in 2016. For the six months ended June 30, 2017, total revenue was $25.4 million, versus total revenue of $24.5 million for the six months ended June 30, 2016.
Product sales were $7.3 million for the three months ended June 30, 2017, compared to $8.7 million for the comparable period in 2016, totaling $17.4 million for the six months ended June 30, 2017 compared to $19.5 million in the same period of 2016.
The decrease for the period was primarily driven by a reduction in sales of pre-launch auto injector devices for use with Teva’s generic epinephrine product and reduced sumatriptan product shipments to Teva partially offset by increased sales of OTREXUP.
The company also completed a non-dilutive, 5-year debt financing with Hercules Capital, providing Antares the ability to draw up to $35 million, with the first tranche of $25 million funded upon execution of the agreement.
7. Corindus Vascular Robotics, Inc. (CVRS)
Corindus Vascular Robotics, Inc. topped out near $4.60 in 2015 and began a steep decline in January 2017 when it posted a multi-year low at 40 cents. The stock rebounded on strong volume one month later, marking an uptrend that reached an 18-month high at $2.25 in early July. The stock has been consolidating at new support for the last three weeks, settling on the 50-day EMA while its on-balance volume holds near the rally high. The bullish configuration favors continuing upside that could reach 2015 resistance at $3.
Second quarter revenue was $2.3 million compared to $0.5 million for the same period in the prior year. The increase is due mainly to CorPath GRX Systems and capital upgrade sales.
The company installed three new CorPath GRX Systems in the second quarter, increasing the installed base to 16 systems and the total installed base to 51 systems. The installed base of 16 systems accounted for almost 90% of all CorPath cassettes shipped for revenue in the second quarter.
Gross profit was $58,000 for the second quarter, compared to a loss of $0.6 million for the second quarter of 2016. The cost of revenues for the second quarter continued to include the effect of under-utilization of production facilities as well as the cost of CorPath GRX system upgrades installed pursuant to contractual service arrangements with no corresponding revenue in the period.
Selling, general and administrative expenses were $5.9 million, compared to $4.4 million in the second quarter of 2016. The increase is primarily due to higher compensation and travel expenses associated with incremental sales headcount, investment in medical education and international sales initiatives, and incremental non-cash stock-based compensation expense related to the CEO and commercial leadership transitions during 2016.
8. Medical Transcription Billing Corp. (MTBC)
Medical Transcription Billing Corp., a healthcare information technology company that provides proprietary web-based solutions, together with related business services, to healthcare providers practicing in ambulatory care settings, went public at $4.28 in July 2014 and entered a downtrend that continued to the April 2017 all-time low at 29 cents. The stock recovered two sessions later in reaction to positive sales news and topped out at $3.84 in mid-May.
A subsequent pullback has now since reached support at the 200-day EMA near $1.20, with a rally from this level generating buying signals favoring ongoing upside into the second quarter high.
Revenues for second quarter 2017 were $7.8 million, an increase of 49% versus $5.2 million in the same period last year. The increase was mainly due to the MediGain acquisition.
The second quarter 2017 GAAP net loss was $1.7 million, or 22% of revenue, an improvement of $1 million compared to a net loss of $2.7 million in the first quarter 2017. The GAAP net loss in the second quarter 2017 was mostly a result of non-cash amortization and depreciation expenses of $1.5 million.
The second quarter 2017 GAAP operating loss was $1.4 million, or 18% of revenue, which represents an improvement of $1 million or 43% from the $2.4 million operating loss in the prior quarter.
As of June 30, 2017, the company had $5.8 million in cash and a working capital deficiency of approximately $4.1 million.
The company raised gross proceeds of $2.3 million from a registered direct offering of its common stock priced at the market on May 10, 2017. MTBC issued 1 million registered shares of common stock to a healthcare institutional investor at a purchase price of $2.30 per share. Concurrently in a private placement, MTBC issued warrants to purchase up to 2 million shares of its common stock, with an exercise price of $5 per share, which are exercisable through May 15, 2018, and would deliver potential gross proceeds of up to $10 million if exercised.
In addition, the company raised gross proceeds of $7.4 million from the sale of about 295,000 additional shares of its non-convertible Series A Preferred Stock on June 23, 2017.
9. Intrepid Potash, Inc. (IPI)
Intrepid Potash, Inc., the only U.S. producer of muriate of potash, sold off to 2008 support at $13.80 in 2014. Two years later, the stock began a decline that reached an all-time low at 65 cents in March 2016. The stock rose above $1.50 in June before settling in a sideways pattern ahead of a December 2016 breakout that soon stalled at $3.04.
The stock spent the last eight months consolidating its gains and is now testing the rally high. A breakout could generate an uptrend reaching 200-week EMA resistance between $6 and $8.
Intrepid generated a second quarter net loss of $5.9 million, or $0.05 per share, delivering a first half net loss of $19.6 million, or $0.19 per share. This marked an improvement over the net losses of $13.4 million, or $0.18 per share, and $31.8 million or $0.42 per share, in the second quarter and the first half of 2016, respectively.
Improvements in year-over-year net loss per share were driven in part by a gain in outstanding shares from a March 2017 secondary offering.
Consolidated gross margin advanced to $3.7 million and $0.8 million in the second quarter and the first half of 2017, respectively, against the prior year. Improvements were due to lower cost solar potash production and higher average net realized potash pricing that offset lower average net realized sales prices for the product, Trio.
Cash provided by operating activities rose year-over-year to $9.7 million and $11.5 million for the second quarter and the first half of 2017, respectively. Increased cash flow was due to strong spring demand, increased potash prices, and the elimination of costlier conventionally mined potash from the production profile.
10. Tantech Holdings, Ltd. (TANH)
Tantech Holdings, Ltd., a manufacturer bamboo-based charcoal products for industrial energy applications and household cooking, heating, purification, agricultural and cleaning uses, went public at $6.00 in March 2015 and began an uptrend that topped out at $33.97 five months later. In the next three months, the stock relinquished more than 90% of its value. Bears maintained control into the April 2017 all-time low at $1, followed by a recovery that reached a 10-month high in July.
Pricing has tested resistance at the September 2016 breakdown through the October 2015 low, with a buying surge setting the stage for upside in the $6 range.
For the six months ended December 31, 2016, revenues were $24.88 million and net earnings were $2.77 million, according to a June 2017 financial report.
Gross margins widened from 25.02% to 30.33% compared to the same period last year, with EBITDA operating margins 18.28% compared to 18.64% the prior year. Year-on-year change in operating cash flow was 32.02%, about the same as the change in earnings.
Penny stocks require investors to make some guesses about the future. Very few such stocks have a sufficient track record to indicate they will prosper. At the same time, the stocks on this list are in significant industries and have the potential to be vital players in those industries.
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